Negotiable Instruments (LAW-616-001)
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On its most basic level, this course analyzes and applies the rules governing the “payment systems” of negotiable instruments, funds transfers, and credit cards.
We will focus primarily on the processes by which a party’s paper or electronic promise (note) or order (draft) to pay money can be acquired– by gift, purchase, fraud, theft, or windfall– by subsequent parties in turn, and what the respective rights and liabilities of the parties are in such situations. Almost immediately, for instance, we will be discussing practical concerns– a number of which are unfamiliar even to many lawyers– about drafting, indorsing, and depositing checks.
Practical themes of the course include: the identifying characteristics of notes and drafts; the non-colloquial definitions of “signature” and “forgery” under the Uniform Commercial Code; procedures to prevent or limit personal liability with regard to transactions involving “commercial paper,” especially in situations involving possible fraud; the role of banks in honoring and dishonoring checks; and the ways in which the Code treats negotiable instruments both as contracts and as pieces of personal property.
On a more general level, we will work extensively with many different sections of Articles 3 and 4 of the Uniform Commercial Code. This brightly-lit legal landscape, marked by centuries-old pathways of practice, contains few places for the shadows of ambiguity to lurk. Many students find a refreshing precision and logic in the provisions of the Code, and a sense of satisfaction in mastering their interpretation, interlocking, and interaction.
As in chess, in the law of negotiable instruments complex situations can easily emerge from a limited number of elements and rules; there exist operational strategies to evaluate, analyze, and resolve even the most complicated of these situations; and the student must actively engage in problem-solving practice to acquire and develop the skill of identifying and applying such strategies.
Finally, this course examines the ways in which commercial practices and the Code have evolved in response to the transformation from purely paper-based payment methods to credit card payments and electronic funds transfers, and to the more recent systems of debit cards and stored-value cards.
This course does not require any previous knowledge of, or experience with, business or business law. The Sales and Secured Transactions courses, which address other Articles of the Uniform Commercial Code, are *not* prerequisites of Negotiable Instruments
Textbooks and Other Materials
The textbook information on this page was provided by the instructor. Students should use this information when considering purchases from the AU Campus Store or other vendors. Students may check to determine if books are currently available for purchase online.
NEGOTIABLE INSTRUMENTS- FALL 2016- PROFESSOR EFFROSS Course 616-001BOOKS
Nickles, Matheson & Adams, Modern Commercial Paper ISBN # 978-0314-032-409 West [*THIS BOOK WILL BE AVAILABLE IN PDF FORMAT THROUGH THE MyWCL WEB PAGE FOR THE COURSE]Brook, Payment Systems: Examples and Explanations, 5th ed. (2013) ISBN # 978-1-4548-1767-3 Aspen
Chomsky et al., eds., Selected Commercial Statutes 2016 ISBN # 978-16346-07490 (available during the summer) WestSeveral copies of each of these books will be on reserve in the Pence Law Library.
It is possible to use a statutory supplement from a recent year instead of the current Chomsky supplement, but there is no guarantee that all of the material will be exactly the same.Because the University Bookstore has not always reliably obtained required books on time, you might consider other (including online) options.
First Class Readings
For the First Class Reading please go to the MyWCL page for this class.